Non Compete

[mruth77]

I am going to buy an existing business. I want the former owner to sign a noncompete, how many years do you normally make that for?

[bullethead]

I think average is 2 yrs. I believe beyond a certain time frame, it is unenforceable - google it or call an attorney

[Mountain Peak]

I have a friend in Chicago that has built and sold two businesses now. He said the standard is 2 years as well.

[bohiaa]

hummm I was thinking it was longer than that......

I remember studying it in college,

maybe it was standard, but some make it 10.....

[mruth77]

Thanks everyone, that gives me a good idea .

[mruth77]

One thing i did forget, noncompete within how many mile radius?

[Sandgropher]

How many mile radius?,,,,, never heard of that one before, my understanding is its not to go after the customers that he has sold you.

Anyway he can put another business is his wifes name and help run it;) for her.

[ArizPestWeed]

In how many miles radious may depend on your area .

Mine is for 5 years , when I hire an employee , he cannot gte his license and compete against me

[rodfather]

5 years, no radius.

[Plant Buyer 83]

5 years, no radius.

I agree with rodfater

[theyatesies]

Just a thought. Here in Oklahoma there is "right to work" and no-compete clauses or contracts are voided. You can still have someone sign one but they still have the right to work at whatever is legal. This was legislature and now law in Oklahoma(vote of the people). Dont ask a lawyer call your department of labor for your state and they will tell you what the law is about this topic.

[lawnMaster5000]

I see a 5 year - no radius as very hard to enforce.

In most cases if it seems a little crazy then the judge will probably see it the same way and throw it out for some reason or another.

2 years and "within one mile of existing service area" or something like that.

If the company currently has a 50 mile radius then you can show that you are a large company covering hundreds of square miles, you could probably get a non-compete for 50-75 mile radius.

Make sure you include a buyout price in your contract. You are paying him $x for this non-compete agreement. If he breaks the agreement he owes you $XXX.00 within 30 days. or something like that.

I AM NOT AN ATTORNEY and HIGHLY suggest consulting an attorney in this matter. Non-compete agreements are often thrown out in court - get an expert to write it for you and it will be more likely enforceable.

[wbw]

But, my attorney tells me the more specific the agreement the more likely it is to be enforcable. Five years is very common, but I would be very specific as to the area. Depending on how large the service area is you will want to limit it to Counties or perhaps even Zip Codes. Please do yourself a favor and seek legal representation. I promise you that it will be money well spent.

[kandklandscape]

was going to buy a lawn care biz off someone in our town until they jacked us! watch yourself!

they ended up not signing it because they figured they would sell to me, make some $$ then turn around steal the customers they sold off of us. well we had a contract of course, he said o i didnt know you wanted one, i said of course we would. well turned out he wanted to back stab us, they are still out doing the same work! sales 750 k only wanted 2,500k something did not sound right here right? well in our contract it said no compete for 5 yrs? attorney wrote it of course, so i think in pa this must mean 5 yrs no compete

[kandklandscape]

it was no compete for 5 yrs within 50 miles, that was how it was worded

[Brianslawn]

Just a thought. Here in Oklahoma there is "right to work" and no-compete clauses or contracts are voided. You can still have someone sign one but they still have the right to work at whatever is legal. This was legislature and now law in Oklahoma(vote of the people). Dont ask a lawyer call your department of labor for your state and they will tell you what the law is about this topic.



similiar here. might be able to do 1 year within the same city, but what if the wife, kid, friend, relative, neighbor, or former employee starts a new biz and hires former owner?

if theyre selling its usually because they aint makin any money and their equip is crap. unless theyre moving or actually retiring.

[DGM]

Here is my Employment Disclaimer. Maybe it will help, I tried to cover all the basis.

EMPLOYEE CONFIDENTIALITY AGREEMENT: provision of employment contract restricting employee from divulging employer’s trade secrets

Employee agrees that any and all knowledge or information that may be obtained in the course of the employment with respect to the conduct and details of the business and with respect to the secret processes, formulas, machinery, etc. used by the employer in manufacturing its products will be forever held inviolate and be concealed from any competitor and all other persons and that he or she will not engage as employer, employee, principal, agent, or otherwise, directly or indirectly, at any time in a similar business, and that he or she will not impart the knowledge acquired to anybody and that should he or she at any time leave the employ of the employer he or she agrees not to enter into the employ or service or otherwise act in aid of the business of any rival company or concern or individual engaged in the same or in similar lines of business. If he or she does so in violation the employer shall be entitled to an injunction by any competent court of equity enjoining and restraining him [her] and each and every other person concerned from continuance of employment, services or other acts in aid of the business of the rival company or concern. Nothing shall prevent him [her], upon the termination of the employment, in engaging in any occupation in which the processes, formulas, and other secrets of the employer will not be directly or indirectly involved. Initial ________

COVENANT NOT TO COMPETE: general form of provision in employment contract restricting a discharged employee’s ability to compete with employer for a reasonable period of time

If such employment is terminated for any cause, employee shall not, for a period of 5 years after leaving the employment, engage directly or indirectly, either personally or as an employee, associate partner, partner, manager, agent, or otherwise, or by means of any corporate or other device, in the Green Industry (landscaping/lawn Care) business, nor shall employee for such period and in such localities solicit orders, directly or indirectly, from any customers of employer, or from any customers of its successor, for such products as are sold by employer or its successor, either for himself or as an employee of any person, firm, or corporation. Initial ________

AT WILL EMPLOYMENT CLAUSE: employment contract provision indicating that employer or employee may terminate the employment relationship at any time with or without cause

In consideration of employer entering into this agreement, employee agrees to conform to the policies and rules of employer in effect from time to time. Each party to this agreement also agrees that employee’s employment and compensation can be terminated, with or without cause, and without prior notice, at any time, at the option of either employee or employer. Initial ________

Employee __________________ Signature __________________ Date __________

Employer __________________ Signature ___________________Date __________

[mruth77]

Thanks to all for the input, it is a great help!!!!